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Why schools are worried about Medicaid cuts hurting special education

May 22, 2017 at 6:30 PM EDT
Special education, which is hugely reliant on Medicaid, is one factor that didn't get much attention in the debate over the Republican health care bill. If the bill becomes law and triggers billions of dollars of cuts to Medicaid, how would it affect the millions of public school kids who receive special ed services? William Brangham talks to Sasha Pudelski of the American Association of School Administrators.
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JUDY WOODRUFF: And, as we just heard, Medicaid cuts are a key part of the president’s proposed budget.

Mr. Trump’s budget assumes that cuts already in the House Republican health care bill will eventually become law and take effect.

We have been looking at the potential impact of the bill. And, tonight, we focus on what it could mean for schools, and particularly special education.

William Brangham has our conversation.

WILLIAM BRANGHAM: Special education just wasn’t part of the debate over the House GOP’s health care bill.

But special education is hugely reliant on Medicaid , and that bill could trigger major cuts to Medicaid, up to $880 billion over 10 years.

So, what would this mean for the millions of public school kids who receive special ed services?

I’m joined now by Sasha Pudelski, who is with the School Superintendents Association.

Welcome to the NewsHour.

SASHA PUDELSKI, The American Association of School Administrators: Thanks. So happy to be here.

WILLIAM BRANGHAM: So, I was really surprised by this. I didn’t appreciate fully how reliant special ed service are on Medicaid. Can you give us a sense of how crucial they are to those budgets?

SASHA PUDELSKI: Absolutely.

So, special education funding has always been low. We have never met our federal commitment to school districts to fund special education. And about 30 years ago, the federal government decided that they would allow to start to bill Medicaid for some of the therapies in particular that are very costly to provide special education students.

And so school districts have been reliant on Medicaid to supplement some of the special education funding they receive for a very long time. It’s standard practice in many districts.

WILLIAM BRANGHAM: So, they spend this money. And then they go to the government say, hey, we did this. We provided these services. Please reimburse us.

SASHA PUDELSKI: Exactly. So, it’s not a one-for-one match, by any means, but it’s a substantial amount they receive back.

WILLIAM BRANGHAM: Generally speaking, who are the kids that we’re talking about here, and what kinds of services are we talking about?

SASHA PUDELSKI: It’s virtually every special education child, because the things that Medicaid can cover run from therapies like mental health therapy, speech therapy, physical therapy, to equipment that they may need, hearing aids.

It may run from wheelchairs to school buses, actually, that provide specialized transportation for kids. So, the services are vast, despite the levels of funding.

WILLIAM BRANGHAM: So, we don’t know right now. The House GOP bill has to go through the Senate. It’s obviously going to get changed quite a bit.

But let’s assume that there are still major cuts to Medicaid in whatever comes out of the Congress. What is the main concern for the school districts?

SASHA PUDELSKI: The main concern is, by this major federal disinvestment in Medicaid, we’re going to have states having to pick up the tab.

And if school districts are competing with hospitals and clinics and other providers for scarce dollars, I don’t see how a governor or state Medicaid director or state legislature is going to decide schools need this money, not a hospital, not a doctor.

WILLIAM BRANGHAM: The Republicans would argue, we have federal deficits that are going to be massive in the future, and we have to address some of these programs like Medicaid, and that these are cuts that are just fiscally smart.

I mean, how do you respond to that?

SASHA PUDELSKI: It’s not kids that are breaking the Medicaid bank, if the bank is even being broken, which I contend it’s not.

But when you look at who benefits from Medicaid, 46 percent of Medicaid beneficiaries are kids. But one out of every five dollars spent on Medicaid is spent on children. So it’s a really efficient way of spending dollars on children’s health care in this country.

WILLIAM BRANGHAM: Let’s say these cuts do come down, and school districts have to find some way to compensate.

What is your sense, from talking to school administrators around the country? How are they going to make up the shortfall?

SASHA PUDELSKI: So, the situation is rather bleak.

We surveyed 1,000 school leaders earlier this year to ask them exactly that question. And they told us that they believe services for kids will be recused. In some cases, professionals will be laid off who work with those kids, like the school nurse, for example, whose salary may be subsidized substantially by Medicaid.

They indicated they may have to raise taxes in order to compensate for this loss. And some districts can do that, and others just can’t. So, it’s going to be a major financial hit, not just on the special education budget, but on the general education budget, because the general education budget will have to subsidize the loss of funding in special education.

WILLIAM BRANGHAM: So, what you’re talking about is really cuts that are really not just for this one dedicated population, but for potentially every student in a public school district.

SASHA PUDELSKI: Absolutely.

When you go to a school nurse’s office, they don’t ask, are you Medicaid-eligible? They take your temperature and find out whether you need to go home. So this is someone who benefits every child, just like a mental health practitioner in the school. And when we no longer can afford their services because they’re subsidized via Medicaid, every child in that building will be hurt.

WILLIAM BRANGHAM: All right, Sasha Pudelski of the School Superintendents Association, thank you so much.

SASHA PUDELSKI: Thank you.

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